The price of fuel in the everyday peacetime economy is going to impact everyone. The first places you will feel it are at the pump and the grocery store.
The DOD pays for nothing, Congress writes the check on our behalf and covers it with borrowed money. The taxpayer is left with the final bill. By taxpayer I mean those folks who actually pay taxes.
In a war situation the answer is gas rationing. If the effort is important enough the DOD is first at the pump. Average Joe gets what's left.

Quoting Venus6971 (Reply 7):There was a plan to build at Malstrom AFB a refinery to turn coal into jet fuel, I wonder if that is still planning or wishing phase.

The Germans did this in WWII extensively, as their access to oil fields was cut off. Certainly technology and ideas have moved forward since then? Whatever the case may be, this is the Achilles heal of the US military. Without oil supply, it can only operate so long. The US economy would be ruined as well.

It would be in everyone's interest for the US DoD to get off oil, as they're the world's largest consumer and operate as a dictatorship from the top down. They could easily give the order and divert resources to develop permanent alternative fuels for their weapons. Algae, Bacteria, Electric, Solar - a whole variety of domestic sources. The entire US economy would benefit as well, by sharing the new technologies with US companies.

Quoting tommytoyz (Reply 8):Whatever the case may be, this is the Achilles heal of the US military. Without oil supply, it can only operate so long. The US economy would be ruined as well.

And the only reason they're vulnerable is because the US political leadership has crippled the US oil production industry, leaving a country that could more than care for its own need a net importer of over 60% of its requirements.

Quoting tommytoyz (Reply 8): They could easily give the order and divert resources to develop permanent alternative fuels for their weapons.

Uh, you're a tad misguided (ok, utterly nonsensical is a better word). "Just give the order" doesn't work in the real world.
Not only is there no viable alternative, even if there was it'd require massive rework of all the engines and everything else that now uses oil based products (lubricants, plastics, etc. etc.).

And there is indeed no viable alternative. "biofuels" just don't work. Not only is the area that'd need to be commited to the production massive (one estimate I've seen said that ALL the woodlands and badlands in the US would need to be converted into grain fields, as well as the entire existing agricultural area of the US, just to meet the fuel demand of the US as it existed 10-15 years ago, and that was a conservative estimate), but the energy density of the fuel produced is a lot lower than that of current fuels so performance of any vehicle using it would go down dramatically.
An jet fighter thus fueled would have its speed and agility decreased by like 20-30%, not a good thing...

Quoting jwenting (Reply 9):Not only is there no viable alternative, even if there was it'd require massive rework of all the engines and everything else that now uses oil based products (lubricants, plastics, etc. etc.).

I do not agree about your "no viable alternative" thinking. What happens when we run out of hydrocarbons from the ground? Go back to the stone ages? Your thinking of biofuels is rooted in grains, sugars and crops. That indeed not viable - I agree on that. I agree with your reasoning too, spot on.

But there are other ways to get hydrocarbon biofuels. Bacterial and Algae that grow and produce hydrocarbons taken from the atmosphere, making them hydrocarbon cycle neutral and needing far less acreage to do so than crops. Think of 10 story vertical tunbes with the stuff - or higher, producing Biofuels. The USAF has already flown a B-52 on Biofuels. So have several airlines like LH, VS and others. LH will operate a commercial line in Germany in 2012, I think STR/HAM all this year solely on it as well.

The US DoD can do things private enterprises would never do or take forever to do. That's basically what I meant by "giving the order". For once, this technology would be very useful to everyone. The US DoD can be very productive at times, like with the GPS satellite system.

Here is another such opportunity, IMHO and it would be self serving as well. Imaginf what this would do for the economy and security. we could abandon patrols in the Gulf as we would not have any interest there anymore as well. It would also take enormous revenue away from Iran, etc...

Quoting jwenting (Reply 9):but the energy density of the fuel produced is a lot lower than that of current fuels so performance of any vehicle using it would go down dramatically.
An jet fighter thus fueled would have its speed and agility decreased by like 20-30%, not a good thing...

Lufthansa stated the biofuel they used in the burnFAIR project had higher energy density.